It's Las Vegas Race Week

Plus: GM registers to join F1

Author

Vincenzo Landino
November 17, 2023

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Las Vegas Grand Prix Ticket Prices See Sharp Decline

As the Las Vegas Grand Prix nears, ticket holders witness a surprising trend—resale prices take a nosedive. Chalk it up to the aftermath of a secured F1 title and an uninviting weather forecast, but the electric atmosphere under the neon glow of the Vegas Strip is experiencing a market cool-down.

Market Dynamics

Bargain hunters rejoice as resale ticket costs for the main event on Saturday have fallen dramatically—by more than half from last month's high. Data snapshots from TickPick confirm a significant 51% dip to $807, a steep drop from the breathtaking $1,645 peak. Not to neglect practice sessions: Thursday and Friday's rehearsals are on a bargain basement tour, 70% and 68% off, respectively.

A dip isn't the average Joe's experience, though—the average list price still sits at a steep $1,701, per TicketIQ insights. But, the entry price shows promise, easing down to $823.

Time slots may be a tough sell, with main race events starting at 10 p.m. local time. Couple that with a weather forecast that’s far from a warm Vegas welcome, and it's clear why some fans might be opting to watch from their cozy living rooms.

Hospitality Adjusts

The ripple effects don't stop at the track—hotel prices are on a slide, too, with average four-night stays trimming down their rates.

I’ve seen reports of hotel rooms as low as $25/night.

Despite ticket turbulence, the financial forecasts paint a wildly optimistic $1.7 billion in anticipated revenue, with an estimated 100,000+ attendees fueling the economy. The grand event's hefty price tag is projected to stretch from $400 to $650 million, factoring in Liberty Media's ambitious spending on real estate and infrastructure.

As the city lights up for a historic return to F1 racing, all eyes are on the outcome—will the event meet its economic promise, or will this end up as a story of missed opportunity?

General Motors registers to join F1 as engine manufacturer from 2028

American racing royalty Andretti has yet to receive word on entry into Formula 1 as the 11th team but announced today a power unit (engines) partnership with American automaker General Motors, set to begin in 2028.

After receiving approval from the FIA, the decision lies within F1, which had record-breaking profits in 2022 of $2.57 billion. Teams receive a cut of profits proportionate to how they finish in the Constructors Championship, so existing teams are hesitant about new entries because that would cut into their profits.

To mitigate this, teams have proposed raising the anti-dilution fee from $200m to $600m in the 2026 Concorde Agreement — the series’ commercial agreement between teams and F1.

This increase reflects current new-entry fees in major sports leagues such as the NHL, MLS, etc, and how F1 teams have seen a massive surge in value since 2021.

If admitted, the team would race under Andretti-Cadillac.

My take: This makes rejecting the Andretti bid nearly impossible. The Andretti name should make this a shoo-in if the series is committed to an American engine provider with an American team. It still shocks me that we’re deliberating over letting Andretti on the grid.

From the Archives (but relevant) Formula 1’s High Stakes Warning

Formula One could require venues along the November Las Vegas Grand Prix circuit to pay for licensing rights. These potential charges, amounting to $1,500 per head, could reach up to $2.25 million for larger establishments - a fee applied regardless of the number of spectators utilizing the space.

It is common for racing organizations to limit unauthorized free viewing of their events and generate revenue from licensed venues. Non-compliant venues risk obstructing their views with structural elements such as barricades or light stands.

While this decision may appear burdensome to some establishments, it aligns with F1's usual operations in places like Monaco. Moreover, authorized sponsors like the Venetian and Wynn won't be asked for additional payments for rooms facing the course.

Participants left disgruntled by these fees should be reminded that Liberty Media's F1, thanks to series like Netflix's "Drive to Survive," has grown immensely from its 8.8 billion valuation in 2016 to a worth of 17.1 billion today. This growth signifies the immense brand equity F1 brings to host cities and sponsors, justifying the licensing fees.

It's worth noting; however, there's fear the charges could lead to excessive cover charges for customers - potentially affecting local businesses negatively.

Average hotel rooms for the weekend are charging $1,000 a night. Add in the $6,651 average race tickets for three days — or the inflated cover to go to a restaurant with good views — and flights; you could easily be looking at a $15,000 weekend for a couple before gambling.

Beer Park is officially partnered with Formula 1 and is charging $5,500 for full, three-day access to the venue’s indoor space, including food and beverages, with over 75 HDTVs and the 9,000-square-foot outdoor terrace with trackside views.

Formula 1 is paying MSG Sphere nearly $10 million to put up its stands in its empty parking lot.

The upcoming Grand Prix event, expected to draw up to 300,000 F1 fans, will occur from November 16 to November 18. Despite the controversy, ticket packages for the public have yet to sell out, according to the Formula One website.

My take: While the optics may rub some the wrong way, including the Las Vegas brass, Formula 1 is well within its right to protect its trademark.

What’s Happening Around the Internet

What I’m Reading

Working in space and defense, I have the privilege of speaking to many interesting engineers. One of whom recently recommended this book.

In When the Heavens Went on Sale, Ashlee Vance illuminates our future and unveils the next big technology story of our time: welcome to the Wild West of aerospace engineering and its unprecedented impact on our lives.

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